Debt service is the percent of:
A. GDP that is owed in debt.
B. disposable income consumers have to pay for their debts.
C. the total value of household debt that banks pay to create the loans.
D. the total value of household debt that consumers pay in interest.
B. disposable income consumers have to pay for their debts.
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The theory of efficient markets suggests that:
A) systemically important financial institutions are more likely to fail. B) long-term investments by banks are more profitable than short-term investments. C) interest rates and inflation rates are inversely related. D) all movements in stock markets are based on rational appraisals of new information.
According to this Application, when the states got into fiscal difficulties in the 1840s through overly ambitious infrastructure projects, the federal government
A) again bailed out all the states. B) did not bail out any of the states. C) bailed out only the northern states, but not the southern states. D) only bailed out the states which comprised the original 13 colonies.